Argentine church independence message: sigh of relief for embattled Macri

A sigh of relief from Argentine president Mauricio Macri and his administration following on Friday's Tedeum by the Archbishop of Buenos Aires, which marks the Church' message on May 25, the symbolic celebration of the first independence efforts during the 1810 Revolution. Read full article

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Cardinal Mario Poli homily called for distributive justice, national unity, care for the poor and the unborn...but avoided talking about the current social situation and the fiscal adjustment...

Well. If calling for distributive justice isn't talking about the impending fiscal adjustment, I don't know what it is. As shown in video recordings, Macri endured the homily with a tight face, but could relax when the cardinal went on to advocate against women's right to legal and safe abortions.

The story above also becomes a propaganda piece when disingenuously describing the impending fiscal adjustment (that) Argentina will have to implement to recover economic stability and investors confidence.

The IMF move was a totally improvised, rushed decision of a panicked government that felt things were getting out of hand. It won't allow the country to recover anything. The IMF money will go to pay for previous debt, and Argentina will then face a snowballing problem that for now has just been kicked ahead.

It's a bad situation for Macri to have got himself in, but what are the alternatives at this point? Another default? Either way he cannot keep borrowing to finance the deficit so cuts or tax hikes will be required.

Also, Macri is planning a vote on abortion, isn't he, so presumably that part was also aimed at him?

It's a bad situation for Macri...but what are the alternatives at this point?

Well. The disastrous economic measures the Macri government has been applying have created the current situation, and are no different of IMF’s advocated policies.

So what could more of the same medicine do to the patient?

Obviously, nothing else than worsening the current situation – a situation the Macri administration has managed to create in just two years and a half.

And so you wonder what Macri can do at this point.

“Either way he cannot keep borrowing to finance the deficit so cuts or tax hikes will be required.”

Again, more of the same medicine. Is it the only solution? Not at all of course. Just as an example, Néstor Kirchner took office in 2003 when Argentina was in a much worse situation than it was in 2015 or even now – after the major foreign debt default in world's history, amid poverty levels above 50 per cent and unemployment at about 25 per cent. In two years and a half he had restructured most of the defaulted foreign debt, paid back the debt with the IMF, and set the country on a sustained growth path.

Kirchner, as opposed to Macri, focused on building a viable capitalism for Argentina with strong state presence and social inclusion. He also opposed neoliberalist recipes and the diktats of the International Monetary Fund.

Macri, in contrast, sticks to an ideologically blind approach, stubbornly applying the worst neoliberal recipes, totally at the wrong time and out of pace with local and global realities.

I must confess that I had not, even in my worst dreams, expected the situation to deteriorate so quickly. I expected Macri to have some leeway and use some gimmicks in 2019 to win a second term.

Now, I believe the IMF trap will delay the final crisis for a while, but will make it much worse in the end.

In regards to the abortion bill, this is not a Macri initiative. He allowed debate but is opposed to passing the law.

If Macri is already following IMF policies then it's not likely to make things much worse.

I'd say in *some* ways Nestor had an easier job than Macri. When you are at rock bottom people have few expectations and demands, either for subsidies or social security or pay rises. Nestor renegotiated the debt which relieved Argentina of a lot of outgoings, but he couldn't borrow more either so he had to balance the budget.

Macri on the other hand has to keep the lights on, and he's been borrowing to do it. Now he's in a crisis of his own making, but it's still a crisis. Would you rather Argentina borrow from the IMF or default again like in 2001?

As for the abortion bill, surely allowing debate is the important thing, even if the President is personally opposed?

1. If Macri is already following IMF policies then it's not likely to make things much worse.

That would be akin to believe that topping your bank's line of credit, then maxing up your credit card and then borrowing some more from a loan shark is not likely to make things much worse. Rendez-vous in six months - or earlier - on this one.

2. I'd say in *some* ways Nestor had an easier job than Macri.

I heard the argument many times. It was not Néstor, it was something else. Being at the bottom things could only go up. Also: Néstor Kirchner benefited from exceptionally high commodity prices. Further: When Néstor took office, the economy had already begun to grow. Obviously! How the heck a Latin American country could do things differently and fare well? It's got to be something wrong there!

3. Would you rather Argentina borrow from the IMF or default again like in 2001?

Your horizon is rather narrow. Argentina must do none of the options you suggest. On the other hand, the country is not at the end of the rope - in fact, millions of dollars keep scurrying out of the country as we speak. The current crisis partially arises from lack of confidence in a government that has revealed utterly incapable of fulfilling a single one of its campaign promises. It is still possible a 180-degree change, but Macri and his team are increasingly isolated and in denial, so there is not much everyone can do but watch hopelessly as Argentina keeps sliding into a black hole.

4. As for the abortion bill, surely allowing debate is the important thing, even if the President is personally opposed?

Sure. In my view, some of those in the best team of the last 50 years thought the debate around abortion would eclipse some of the bad news on the economic front, but that did not happen. Let's hope Argentina follows on Irlanda's steps and ends this deeply tragic, prejudiced and out-of-date prohibition.

I heard the argument many times. It was not Néstor, it was something else.

I would not go that far. There is always a possibility to screw things up, so Nestor evidently did something right. For a start renegotiating the debt to remove the millstone around Argentina's neck.

I'm only saying that taking over an economy that is gradually declining is not the same as taking over one that already reached a crisis. I remember when Macri was elected, some analysts said it was a bad thing exactly because Argentina had not hit bottom yet and it would be blamed on Macri when it did. Perhaps he thought he could avoid this, but all his borrowing has just made the fall much harder if/when it happens.

I think he should have changed course when it became obvious how imports were outstripping exports, but it's a bit late now. The current problem is that having taken money from the investors and speculators, it is their confidence that Macri needs to keep, and what they like is exactly the hated neoliberal measures. If they pull their money out suddenly it could cause a real crisis, and that is what Macri needs to avoid.

Re the abortion bill, is there much chance of it passing? I don't know what ordinary people's attitudes are like.

...having taken money from the investors and speculators...if they pull their money out suddenly it could cause a real crisis...

You have clearly illustrated the ills of the Macri model. A country whose economic stability depends on the mood of foreign investors after borrowing nearly US$ 200 billion is a doomed country.

However, there is much more to the Macri government and its list of failures. This is a government that got elected riding on a wave of indignation against an alleged Kirchnerist corruption. However, there is mounting evidence that while corruption cases existed under the watch of the previous government, the current one is structurally corrupt. As a result, as Macri loses his grip on power, the scandals that will pop up will finish the little credibility the current government still enjoys. You won't, however, read about them in MP.

On the abortion bill front, last thing I heard there is still a bunch of undefined legislators so it's difficult to predict the result. Women, however, have mobilized in big numbers, with green symbols across the country, to demand its approval.